1Mby1M Virtual Accelerator AI Investor Forum: Investor Gus Tai on VC Industry Size (Part 5)

Sramana Mitra: You raised two points I want to elaborate on briefly, especially as we near the end of our time. Human nature, as you noted, is status-seeking. Until now, status in entrepreneurship has been associated with venture-funded startups. Venture-backed founders are often seen as higher status than bootstrapped entrepreneurs, and the media has historically reinforced this bias.

In 2007, Sridhar came to see me and told me that no media outlet wanted to cover his company because he had not raised venture capital. I was stunned because it was an extraordinary story. I wrote the first piece on Zoho, followed by a major Forbes column, and that is how the world discovered Zoho. The media simply did not know how to evaluate a powerful bootstrapped entrepreneur.

That is beginning to change. LinkedIn is full of AI noise, but it also features entrepreneurs openly sharing how well they are bootstrapping. That matters because it comes directly from founders. We have published countless case studies: pure bootstrapping, bootstrapping before raising capital, bootstrapping with a paycheck, solo founders, and service-based bootstrapping. All of this builds awareness.

I am encouraged by the report showing a 50% increase in solo entrepreneurs. We have supported solo founders from day one, despite the bias they face. Accelerators, venture capitalists, and the broader ecosystem often reject solo founders in favor of teams.

The reality is that working with a co-founder is not easy. Co-founder breakups are far more complex than divorces because they live permanently on your cap table. You can end a marriage, but you cannot easily restructure ownership.

Operating as equal co-founders under constant stress is extremely difficult. Solo founding can be lonely, but it does not have to be. You can build and lead a strong team without a co-founder. Having a co-founder does not guarantee support or harmony.

Performance will ultimately speak for itself. We are already seeing solo founders succeed. Base44 was founded solo, built in six months, and acquired by Wix for $88 million. ServiceNow, one of the most successful SaaS companies ever, was founded by Fred Luddy as a solo founder. He built an exceptional team and an enduring company.

If you are listening as a solo founder, consider this unambiguous support. We support solo founders and will help you succeed, including raising capital when performance and metrics justify it. If you show traction, you are fundable, solo or not.

Gus, before we close, is there anything you would like to add?

Gus Tai: One unifying theme ties all of this together. Entrepreneurs today can gain a real edge by embracing how disruptive AI is and the discontinuities it creates.

In the late 1990s, being a solo founder was difficult because building companies required large amounts of capital and infrastructure. Today, AI makes it far easier to start, experiment, and test ideas quickly.

As AI reshapes traditional jobs, it pushes all of us to think like sole proprietors. The question becomes how to use AI to augment ourselves and our teams. Human collaborators still matter, but AI allows founders to start smaller, faster, and more effectively.

We may look back five years from now and say it was obvious that founders should start solo, bootstrap with AI, and deeply understand customer needs before scaling.

Sramana Mitra: We saw a similar shift during COVID. We have operated as a virtual organization since 2010, long before it was accepted. When COVID hit, the stigma against virtual companies disappeared.

Solo entrepreneurship will follow the same path. AI will enable a wave of exceptional solo-founder-led companies. In our own organization, AI has dramatically increased productivity, but only because we know how to use it. Becoming AI-first is essential for solo entrepreneurs, and it is absolutely feasible.

To summarize, this is a controversial stance: the number of venture capital firms should decline, and the amount of capital flowing into venture should decrease. Bootstrapping, virtual companies, and founders need stronger support.

This runs counter to the venture capital industry. The same applies to accelerators. We are a non-equity accelerator and always have been. I believe accelerators should not take equity, even though that is contrary to industry norms.

Thank you, Gus. I appreciate the discussion.

Part 1 | Part 2 | Part 3 | Part 4 | Part 5

One Million by One Million (1Mby1M) is the first global virtual accelerator in the world, founded in 2010 by Silicon Valley serial Entrepreneur Sramana Mitra. It offers a fully online entrepreneurship incubation, acceleration and education resource for solo entrepreneurs and bootstrapped founders working on tech and tech-enabled services ventures. 1Mby1M does not charge equity, offers an AI Mentor available 24/7 in 57 languages, and offers a compelling alternative to Y Combinator and other equity accelerators.

This segment is part 5 in the series : 1Mby1M Virtual Accelerator AI Investor Forum: Investor Gus Tai on VC Industry Size
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